Microsoft's Internet of Things strategy: Ambitious, diverse, and business-friendly

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Microsoft's Internet of Things strategy is multifaceted, running the gamut from consumer devices to business-focused products and services. Here's a look at what's happening now and what lies ahead.

Internet of Things (IoT) is most commonly associated with consumer devices like fitness bands and in-car entertainment systems. But IoT actually covers a much wider range of devices, many of which are going to be increasingly important to enterprise users, in terms of both their internal usage and external support strategies. Point-of-service terminals, ATMs, ruggedized handheld phones and tablets, medical equipment, and a lot of other non-consumer-specific devices are all parts of the IoT family.

Microsoft has been a player in the embedded-device space for more than 15 years. But only recently has the company attempted to apply a cohesive plan across its own Windows-centric platforms, along with non-Windows-based devices.

At a number of recent events — including CEBIT, Microsoft's recent Build 2014 developer conference, and a data-focused Microsoft customer and analyst event — Microsoft execs shared quite a few pieces of the company's evolving IoT strategy.

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Image: James Martin/CNET

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In attempting to understand what Microsoft is doing here, it's worth noting the not-so-surprising role the company's Windows Embedded team is playing in this space. Microsoft moved its Embedded team under its Server & Tools business unit, in a move many questioned at the time, back in 2010.

When the company reorganized in July 2013, the Embedded team remained part of the renamed Cloud & Services unit. But late last year, Microsoft officials moved the team under the new unified operating system group (OSG). In spite of that move, the work on which the Embedded/IoT team is focused still appears tightly aligned with what's happening on the Microsoft Azure cloud side of the house.

The Embedded/IoT team is continuing to offer a handful of versions of Windows Embedded targeted at different devices. For "small" devices, like gateways, wearables, and panels, there's Embedded Compact. For "medium" devices, including handheld point-of sale devices, there's Embedded Handheld 8.1. For "large" devices, like ATMs and MRI equipment, there's Embedded Industry 8.1 and Embedded Standard. And for the tiniest of devices, there's the .Net Micro Framework, the code for which Microsoft recently open sourced and put under the domain of the newly created .Net Foundation.

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Image: James Martin/CNET

On the hardware front, Microsoft is working on a couple of Windows-compatible hardware-development boards that also may feed into its IoT strategy. It's working with Intel on the "Sharks Cove" tablet builder-board that's due in the second half of 2014. It's also working with Intel on a system-on-a-chip board, powered by Arduino, known as Galileo. A software developer kit for Galileo is slated for this spring.

Beyond the "Things"

At Build this year, Microsoft officials talked about more than just the versions of Windows embedded in IoT devices. In this bigger IoT picture, the way the devices receive and send information and what users can do with that information are equally important (if not more important) than the OSes on those devices. It's also worth mentioning that Microsoft's latest IoT plans are not restricted to devices running Windows. The new Microsoft is definitely attempting to position itself as more of a cross-platform software and services provider.

Microsoft's plan, at least initially, calls for the company to provide device management, communications, and data analytics (including predictive analytics) IoT services.

CEO Satya Nadella took the wraps off the data analytics service during an April press and customer event by announcing a limited preview of Azure Intelligent Systems Service. This service is designed to allow users to capture and manage machine-generated data from the growing number of IoT devices and sensors.

There's no official word on when Microsoft may release a wider public preview and/or the final version of this service, but the analysis tools components of it — Microsoft's HDInsight Hadoop-on-Azure, SQL Server 2014, and PowerBI business-insights service — are all in place today. Microsoft is championing the service as helping IT pros make better use of resources in areas such as power management.

With big data moving at an increasingly rapid velocity, IoT also involves making sure the right processing is occurring at the right point in the chain. As a result, distributed processing also becomes part of the IoT equation.

Data isn't the only raw material that IoT services can harness. At Build 2014, Microsoft execs also talked up the importance of providing remote control, preventive maintenance, proactive sales, and remote servicing via IoT services. When viewed this way, IoT becomes a key element of a variety of business functions, "from CRM to PRM [product relationship management]," as one company official quipped during his talk at Build.

Managing the messaging

The other piece of the IoT puzzle Microsoft is attempting to solve is the communications component. If the cloud is seen as an enabler for "smart mobility," messaging systems and services are crucial. That's why there are developers working on building out messaging for connecting distributed apps/devices.

Clemens Vasters, a product strategy PM/architect on the Windows Azure Engineering team, has been spearheading a lot of the work on this front. Vasters has written various articles and recorded videocasts focused on the way the Azure Service Bus, which is its messaging infrastructure that runs on Microsoft's Azure cloud platform, fits into Microsoft's IoT strategy.

Vasters has said repeatedly that in spite of its name, the IoT is neither about the internet nor things. It's actually more about connecting distributed systems. That's why Microsoft has been looking at devices as being best controlled when they have a dedicated gateway with a messaging inbox and outbox. Telemetry data and alerts go into the outbox; commands and queries funnel into the inbox. (The codename of the gateway that Microsoft is building to enable this communications service is "Reykjavik.")

Microsoft is planning to make unspecified "enhancements" to the Azure Service Bus coming soon that are specific to IoT, officials said at Build. And already, both Microsoft-developed and third-party IoT services are starting to be built on top of the Azure Service Bus.

While Microsoft also is working on consumer-focused IoT hotspots, such as home automation systems and wearable devices, expect the company to make plenty of investments around the more enterprise-focused parts of the IoT business in the coming months and years. Azure sounds like it will be a cornerstone of whatever Microsoft does here.

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